Although SP-C is the first surfactant component to appear during lung development, the function of SP-C is the least understood of the surfactant proteins. Several lines of evidence strongly support the hypothesis that SP-C is important for surfactant function and turnover: Replacement surfactants with recombinant SP-C as the sole protein component have the functional properties of natural surfactant in vitro and in vivo: and, most importantly, several term human infants with normal levels of SP-A and SP-B but undetectable SP-C protein rapidly developed severe RDS and ultimately succumbed to the disease. The overall goal of this project is to assess the role of SP-C in surfactant homeostasis. Intracellular trafficking, (specific aim 1) and secretion (specific aim 2) of SP-C will be characterized in isolated Type II epithelial cells. The role of SP-C in surfactant homeostasis will be assessed by characterizing the pathophysiology associated with expression of mutated or deleted SP-C constructs in vivo (specific aims 3 and 4). SP-C constructs will be expressed in Type II cells of SP-C knockout mice in order to achieve expression of the human transgene in a null background. The effect of transgene expression of the human transgene in a null background. The effect of transgene expression on lung structure and function will be assessed by biochemical, morphological and physiological analyses of the surfactant system in fetal and postnatal offspring. Transgenic mouse models will be generated to study the importance of acylation for mature SP-C function (specific aim 3) and the structural basis for optimal biologic activity of the mature peptide (specific aim 4). The experimental approach will permit characterization of the function of SP-C in the context of the whole animal as well as the isolated Type II cell and facilitate identification of its role in surfactant homeostasis.